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The basic accounting equation is in balance when the creditor and ownership claims
against the business equal the assets.
Answer:
If a company changes its inventory valuation method, the effect of the change on net
income should be disclosed in the financial statements.
Answer:
An aging of accounts receivable schedule is based on the premise that the longer the
period an account remains unpaid, the greater the probability that it will eventually be
collected.
Answer:
The carrying value of bonds is calculated by adding the balance of the Discount on
Bonds Payable account to the balance in the Bonds Payable account.
Answer:
The following accounts are included in the ledger of Wainwright Company:
Advertising expense
Freight-in
Inventory
Purchases
Purchase returns and allowances
Sales revenue
Sales returns and allowances
Which of the accounts would be included in calculating cost of goods sold?
Answer:
A 10% stock dividend will increase the number of shares outstanding but the book
value per share will decrease.
Answer:
An account is often referred to as a T-account because of the way it is constructed.
Answer:
Cost of goods sold is deducted from net sales revenue for the period in order to arrive at
________________.
Answer:
